Online ad revenues soar

Online ad revenues grew to $214 million in the second quarter, a rise of about 313 percent over a year ago, the Internet Advertising Bureau reported.

8 October 199712:45 am BST

Online ad revenues soared to $214 million in the second quarter, a rise of
about 313 percent over a year ago, the Internet Advertising Bureau reported today.

Monthly advertising reached $53 million in April, $70 million in May, and $91
million in June, and was up by $85 million in the second quarter compared
with the previous quarter.

The IAB's survey also found that online advertising is leveling more evenly
across the top 50 or so online publishers.

In the first quarter of 1997, for example, the top ten online publishers
accounted for 63 percent of advertising revenues, compared with 69 percent in
the second quarter.

"The second-quarter results are very exciting and show increased vitality,
and the strongest numbers ever," said Rich LeFurgy, chairman of the IAB and
senior vice president of advertising for ESPN/ABCNews Internet Ventures.

The survey, which contains data from more than 200 different Internet
publishers that account for 90 percent of the industry's revenues, found
that banners remain the predominant ad vehicle.

But the survey also found that sponsorship of online content has increased notably, capturing 41 percent of total revenues. Banner ads represent 54 percent.

The IAB's Revenue Reporting Program, which is administered by Coopers &
Lybrand's New Media Group, found that the five leading industry categories
continued to dominate Internet advertising during the second quarter: Consumer-related businesses accounted for 30 percent, financial services
22 percent, computing products 21 percent, and tied were new media and
telecommunications, which each had 7 percent.

In the first quarter, consumer products captured only 17 percent of spending.

"I think the numbers are ramping up because more companies are moving out
of the experimental level [of advertising online] and committing more
investment," said LeFurgy.

The data for the IAB survey is compiled from data collected directly from
companies engaged in selling advertising online--rather than projections
or estimates.

The survey found that the vast majority of revenue transactions continue to
be cash-based, with barter deals accounting for only 4 percent of total
spending.